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Jett Is Cleared Of Securities Fraud

August 02, 1998

In Business This Week

JETT IS CLEARED OF SECURITIES FRAUD

THE 1994 BOND-TRADING SCANDAL THAT ENDED THE CAREER OF JOSEPH JETT at Kidder Peabody culminated in a surprising verdict on July 21. A Securities & Exchange Commission administrative law judge found that the former Kidder government-bond chief created $350 million in illusory profits by manipulating Kidder's accounting system. But Judge Carol Foelak found Jett guilty only of record-keeping violations and cleared him of the securities-fraud charge sought by the SEC. Foelak ordered that Jett be barred from the industry for life and required to disgorge $8.2 million in bonuses. Jett's attorney promises to appeal.EDITED BY KELLEY HOLLAND